All signs point to continued steady growth in commercial real estate investment, two top real estate investment bankers said at the Arnall Golden Gregory breakfast briefing “The Current State of the Real Estate Capital Market.”
Eastdil Secured Managing Directors Eric Zimmermann and Chris Campbell said factors that might trigger a downturn – oversupply, overleverage, a banking crisis, a global financial crisis, a material recession – do not exist.
U.S. real estate continues to be attractive for investment because of yields and safety, they said, but conservative lending, commitments by institutions to disbursing funds to investors, and pension fund allocation limits will keep growth “slow and steady.” They see cap rates as trending even lower.
Projects that are the easiest to fund are the “best of the best,” including infill sites with high barriers to entry, they said.
Mr. Zimmermann and Mr. Campbell addressed more than 80 people at Arnall Golden Gregory’s offices in Midtown Atlanta.
Abe Schear, a partner in Arnall Golden Gregory’s Real Estate Practice who moderated the event, told the audience, “We remain busy across all of our real estate product lines.”
Illustrating Atlanta’s healthy real estate market, Mr. Schear described the firm’s representation of Emory University in the acquisition of the 60-acre Executive Park site for a medical campus, and Emory’s partnership with the Atlanta Hawks on a state-of-the-art training facility on the property.
Atlanta is seen as a top 10 market for foreign real estate investment, Mr. Campbell pointed out. He mentioned that recent Korean investment in Dallas, a city comparable to Atlanta, signals that Atlanta development will see even greater foreign investment.
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